Changing tills, upgrading computer systems and adapting accounting practices are among the problems facing the retail sector, as the introduction of the euro looms. A 3 1/2 period, from January 1st, 1999, to July 1st, 2002, is currently being allowed for the changeover from national currencies to the euro's full introduction. Towards the end of this period pounds and pennies will finally disappear.
The changeover has some parallels to the move to decimalisation on February 15th, 1971. An 18-month phase-in period was allowed from "Decimal Day" but the new system was not expected to last long, as The Irish Times reported:
"There is a distinct possibility that the new currency system being introduced today may remain with us for only 10 years, if the plan materialises to introduce a common European currency in 1980." But whereas decimalisation was a currency name change, EMU is the adoption of a new currency. In addition, "the range of new technologies that exist today did not exist. Payment systems were less complex and less numerous", says Mr Michael Watson, head of Bank of Ireland's Group EMU Unit.
He puts the changeover costs at about £10,000 on average for a small businesses "but that would go into many multiples of that when you are looking at large supermarket chains or large department stores".
The fact that euro changeover straddles the year 2000 is an added headache, with outmoded computer systems being unable to digest post 1999 dates.
Department stores are assuming EMU will go ahead on schedule. Arnotts says it will stay with the pound for as long as possible, believing it is the smoother course for financial transactions. Mr Derek Browne, treasurer at Arnotts, says the dual pricing system - where goods are priced in national currencies and euros towards the end of the changeover period - will be "one of the biggest bugbears", as customers are gradually weaned onto the euro. They have set up a committee to examine costings, expected to be "a couple of hundred thousand pounds". Retail outlets will be pushing for a date of euro introduction other than New Year's Day, 1999, in the middle of the January sales. Mr Eamonn Quinn, marketing director of Superquinn, says February or March would be a more suitable month, when there is a traditional sales slump.
He would like to see the stores encouraging euro usage. "What we would like to see when it goes ahead is that while we would take money in both currencies we would only give out change in the new currency. That would clear the old currency out of the system very quickly . . . that has to be finally decided. It is a question of customer communication," he says.
But before the introduction of the euro hard currency, sometime before January 1st, 2002, the issue of euro transactions with credit cards and cheques will arise.
The other issue facing retailers is how to approach price quotations: Is quoting in both currencies for price per kilo, price per pound and actual price, a customer service or disservice? "It gets quite complicated, and it certainly is not customer friendly," Mr Watson says.
